U.S. Steel Lays Off Over 1,000 Workers as It ‘Indefinitely’ Idles Illinois Steel Mill

The company said the decision is meant to to help ensure melt capacity is balanced with its order book.
U.S. Steel Lays Off Over 1,000 Workers as It ‘Indefinitely’ Idles Illinois Steel Mill
A steel coil warehouse at U.S. Steel's Granite City Works plant in Granite City, Ill., in July 2018. (Whitney Curtis/Getty Images)
Bill Pan

U.S. Steel, the largest domestically based steel producer, has indefinitely idled its operations at its plant in Granite City, Illinois, laying off more than 1,000 workers.

In a statement on Tuesday, a spokesperson for the Pittsburg-headquartered corporation said the decision is meant to “to help ensure melt capacity is balanced with our order book.”

The Granite City mill produces “high-quality hot-rolled, cold-rolled and coated sheet steel products” for the construction, container, piping and tubing industries in addition to automotive, according to the company’s website. Now that operations are indefinitely on pause, the company will consolidate iron and steelmaking operations to its other active iron and steel plants to meet customer demands, the U.S. Steel spokesperson said.

The layoff affects at least 1,076 Granite City workers, according to a notice posted Tuesday to Illinois Worknet, an employment information website maintained by the Illinois Department of Commerce.

In September, U.S. Steel temporarily shut down its last operating blast furnace at the Granite City site in an attempt to mitigate risk in the wake of the then-ongoing United Auto Workers (UAW) strike with the Big Three automakers. That furnace had been idled for more than two years until the company fired it up again in March 2018 because of then-President Donald Trump’s plan to impose tariffs on imported steel and aluminum.

“We have recently had to make some tough decisions related to reducing fixed costs in September,” U.S. Steel President and CEO David Burritt told investors during an earnings call late last month.

“I say this was a difficult decision, and it truly was, but it was a necessary one,” Mr. Burritt said at that time. “With the auto worker strike impacting the order book in the fourth quarter, we acted to ensure that our melt capacity is in line with demand. We remain nimble, enabling us to maintain profitability as we manage through uncertain market conditions.”

The largest supplier of steel to the automotive industry in North America, U.S. Steel reported that automaker customers comprised 31 percent of its 2022 revenue.

Some 400 workers were temporarily suspended in September as the result of the furnace closure. According to Rep. Nikki Budzinski (D-Ill.), those 400 employees are among the 1,076 job cuts referenced in Tuesday’s notice.

“Two months ago, U.S. Steel handed out pink slips to 400 workers as they blamed the United Auto Workers (UAW) strike for reduced steel demand. Today, with strong steel prices and operations resumed at the Big Three automakers, U.S. Steel is planning to make these layoffs permanent while putting another 600 jobs on the chopping block,” the congresswoman said in a statement Thursday.

“It’s clear that the company’s executives are more concerned with lining their own pockets than they are with the livelihoods of the workers,” Ms. Budzinski said, adding that she will “closely monitor” how the layoff is being implemented.

State Rep. Amy Elik, a Republican representing parts of the Granite City, said she was “disgusted and saddened” by the decision.

“Granite City employees and their families have provided loyal, skilled labor to the steel industry for decades, and U.S. Steel is pulling the rug out from under them,” Ms. Elik said in a statement. “U.S. Steel should be doing everything it can to keep the Granite City steel mill operating at capacity, and I don’t see the company making that effort.”

In the meantime, Ms. Elik advised that employees affected by the layoff contact the Illinois Worknet Center for job search assistance and potential training opportunities.

Meanwhile, State Sen. Erica Harriss, a Republican whose district covers the Granite City, said her office is has been in contact with resources to support those impacted.

“As a granddaughter of a U.S. Steel worker, I understand that these aren’t just jobs lost but these are livelihoods and lives torn apart,” she said. “My staff and I are in contact with state, federal, and local resources to ensure we are in the best position to help constituents navigate the uncertain road ahead.”

Many of the Granite City site workers are members of the United Steelworkers (USW). The 1.2 million member-strong union on Thursday condemned the layoffs as well as U.S. Steel’s furnace shutdown during the UAW strike.

“Rather than invest in the future, U.S. Steel instead keeps turning its back on its highly skilled union workforce and their communities,” USW President David McCall said, noting a “similar trend” at other U.S. Steel plants over recent years.

“Within the past five years, U.S. Steel similarly abandoned its Great Lakes and Lone Star Steel operations, shut down coke batteries in Clairton, [Pennsylvania], and reneged on its commitments to invest major capital expenditures in the Mon Valley,” the organization said.